Congress May Dole Out Harvey Relief in Stages, GDP Growth Revised
August 30, 2017
Congress may dole out Harvey relief in stages, rather than a catch-all relief bill as was the case with Superstorm Sandy. GDP growth signals upward trajectory at its revised 3% rate.
- Congress may dole out Harvey relief out in stages, reversing Sandy policy. Congressional Republicans have indicated they may send out Harvey relief in stages. GOP lawmakers such as Senator Roy Blunt of Missouri, have indicated that it may be more sensible to delivery funding as needed, as opposed to sending a catch-all relief bill, akin to the $50 billion the Northeast received in the wake of Sandy. Sandy spending included disaster preparedness and mitigation measures in addition to relief, which some Republicans viewed as wasteful. However, critics argue multiple bills may delay funding and provide political cover to object to parts of the Harvey relief effort. FEMA likely has enough funding to respond to the most urgent needs in Texas, and it is unlikely that Congress will debate any kind of relief bill in an already busy September. [Politico]
Economic Indicators & News
- GDP growth revised to 3%, signaling upward trajectory. Data released Wednesday indicates that US Gross Domestic Product grew at an annualized rate of 3% this past quarter, up from estimates of 2.7% last quarter. GDP growth was fueled by a combination of consumer spending and some boost in business spending, specifically from spending on wireless-phone services, used cars, electricity and natural gas on the consumer side and software on the business side. While the growth rate is welcome news, economists believe the rate is unsustainable in the coming months, as fallout from Hurricane Harvey and its impacts on the energy sector combined with other factors trim growth. These revisions bring the first half pace of growth to 2.1%, equal to the average growth rate in the years since the recession. [Bloomberg]
- ADP data show more jobs added than forecast. Companies increased private payrolls by 237k this past quarter, beating analyst estimates of 185k. Growth notably occurred in the goods-producing sectors, including builders and manufacturing, and in transportation and utilities, a promising trend for many blue collar workers. Firings have also been limited, as the availability of workers diminishes in a tight labor market. [Bloomberg]